FINALS REVIEWER Flashcards by Ronamae Oliva

a French economist, came up with
the word entrepreneur.
- known for his theory Say’s Law of Demand, which states that production drives demand

Jean-Baptiste

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Entrepreneurs in IT-related industries are more
commonly referred to as

Start-ups

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The __________ governs entrepreneurs and businesses in the
Philippines. The agency is in charge of business
registration and trade policies.

Department of Trade and Industry (DTI)

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also known as the Youth
Entrepreneurship Act, was passed in July 2015. The act aims to support the development of young individuals (18 to 30 years old) in the fields of finance
and entrepreneurship by integrating financial literacy
entrepreneurship programs in education curriculums.

Republic Act No. 10679

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is a nonprofit organization that advocates
entrepreneurship in the country

The Philippine Center for Entrepreneurship

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refers to two or more corporations
under the same ownership or parent company.

Conglomerate

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Steps in sole proprietorship business registration in
the Philippines

DTI - register business name
Barangay - secure barangay clearance
Municipality - get a business permit
BIR (bureau of internal revenue) - apply for tax identification number (TIN); secure
authority to print receipts; have ledgers and invoices stamped.
SSS - apply as a self-employed owner.

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Is the cost of borrowing

Interest

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a business idea is a common issue that
hinders individuals from taking the entrepreneurial
route.

Financing

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may be awarded to qualified
individuals under the Youth Entrepreneurship Act.

Grants and Loans

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g is a term that describes solicitation
of funds and outsourcing services or ideas to people via the Internet.

Crowdsourcing

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refers to the number of people passing
by the business.

Foot Traffic

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is paid by entities that are exempt
from VAT, with gross annual sales not exceeding a
limit prescribed by the BIR, and subject to additional
guidelines S

Percentage Tax

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is a tax on sale, lease, and importation of goods and services and is subject to additional guidelines.
The VAT rate is currently at 12%.

VAT

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is imposed on the sale of capital
assets such as real estate properties and stocks. Real
estate tax is at 6%, while tax on gains from the sale of
stocks ranges from 5% to 10%.

Capital Gains Tax

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is the most common tax filed by
employed and self-employed individuals or those who
derive their income from business or professional
practices. Personal income tax rates range from 20%
to 35% effective January 2018 as part of the Tax
Reform for Acceleration and Inclusion (TRAIN). T

Income Tax

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Republic Act 10963

The Train Reform

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Tax laws; fiscal policy; other
government rules and actions

POLITICAL

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GDP; inflation and prices; interest
rate; forex; other economic indicators

ECONOMIC

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Demography; lifestyle change and other
trends

SOCIAL

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Technological advances;
research and new development; new processes

TECHNOLOGICAL

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New and updated business requirements

LEGAL

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Environment regulations;
resource constraints; climate change

ENVIRONMENTAL

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refer to revisions on the implementation
and collection of taxes

Tax Reforms

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is an example of excise tax imposed on goods considered as vices such as alcohol and tobacco.

Sin Tax

Republic Act No. 10351

Sin Tax Reform Law

When government spending exceeds revenue, the government runs into a

Budget Deficit

is when government tax revenue is greater than spending

Budget Surplus

Its main responsibility is to maintain global monetary stability through economic policy

International Monetary Fund (IMF)

leads the research on Philippine socioeconomic data that is used in policymaking. The same agency also monitors infrastructure projects throughout the country.

National Economic and Development Authority (NEDA)

Republic Act No. 9994

Expanded Senior Citizens Act of 2010

is a government entity under the Department of Agriculture.

Phil Rice

was filed in November 2018, seeking to ban the use of single-use plastics in the country.

Senate Bill 1948

to minimize air pollution by monitoring smoke-belching vehicles, industrial plants, and wood or coal burning.

Republic Act No. 8749, Clean Air Act

was made into law in 2004, much later than the Clean Air Act, which was enacted way back in 1999. T

Republic Act No. 9275, Clean Water Act

was signed into law in 2009. The act aims to evaluate government programs to ensure that policies consider the effects of climate change and new developments are sustainable.

Republic Act No. 9729, Climate Change Ac

was signed in 2008. To emphasize the importance of educating people.

Republic Act No. 9512, Environmental Awareness and Education Act

includes industries in the business of extracting raw materials from natural resources

Primary Sector

groups industries that process raw materials into goods through manufacturing and construction

Secondary Sector

covers the marketing and selling of raw and manufactured products.

Tertiary Sector

s includes four main industries: (1) mining and quarrying; (2) manufacturing; (3) construction; and (4) electricity, gas, and water supply.

industry Sector

includes textile manufactures and fabricated metal and steel products

Heavy Manufacturing

composed of relatively easier-to-transport products such as household food products and plastic products.

Light Manufacturing

It is characterized by the marketing and selling of products from the primary and secondary sectors. The Philippines has five main service industries: (1) transport, storage, and communication; (2) trade and repair of motor vehicles, motorcycles, and personal and household goods; (3) financial intermediation, (4) real estate, renting, and business activities; and (5) public administration, defense, and compulsory social security

Service Sector

refers to the concentration of labor in the main sectors of the economy. It requires a comparison of the number of workers employed in the primary, secondary, and tertiary sectors

Employment Structure of the Economy

is composed of institutions that are privately owned.

Private Sector

is composed of government-owned enterprises.

Public Sector

by private sector entities are goods characterized by rivalry and excludability

Private Goods

means that a good consumed by an individual cannot be consumed by another individual or household

Rivalry

or exclusiveness means that paying for a good or service prevents access by others who have not paid for the good.

Excludability

Goods provided by the government are called

Public Goods

means that consumption or use of a public good does not prevent other Individuals from consuming or using the same good regardless if they paid for it or not.

Nonexcludability

are characterized by excludability and nonrivalry.

Club Goods

means that consumption or use does not reduce the quantity of the goods available for others

Nonrivalry

are characterized by rivalry and nonexcludability

Common Goods

Public goods are sometimes referred to as

Social or Collective Goods

__________ happen when consumption of a good affects another party

Externalities

lead to benefits to third parties. The benefit to society is greater than personal benefit

Positive Externality

typically have positive externalities but the benefits are often underestimated

Merit Goods

have negative externalities and consumption of which causes harm to society Examples include smoking and illegal drugs

Demerit Goods

is a standard industry classification developed and primarily used in the financial market.

Global Industry Classification Standard (GICS)

is the UN’s version of the GICS. It is primarily used to measure and compare economic activities across nations.

International Standard Industrial Classification (ISIC)

The ______________ systems were established to fulfill the same objective of having a standard for industry comparisons.

Standard Industrial Classification (SIC) and the North American Industry Classification (NAIC)

is the country’s guide to industry classifications based on business productions.

The Philippine Standard Industrial Classification (PSIC)

Barrier to entry evaluates the ease for new players to penetrate an industry

Threat of New Entrants

means a high volume of production to achieve a certain level of revenue.

Economy of scale

drives operational costs and serves as a deterrent to new players

Access to a wide distribution channel

the more unique the product or service is, the less is the threat because it is harder to take market share away from established brands

Product Differentiation

or require a large initial investment deter new players.

Capital Intensive

may ease or restrict new players from entering an industry.

Government Policies

is the second factor that affects the level of competition among players in the industry.

Bargaining Power of Suppliers

refers to the number of suppliers in the industry. The higher the supplier concentration, the weaker is the bargaining power of suppliers.

Supplier Concentration

suppliers have high bargaining power in a situation in which there are no alternative inputs available.

Availability of Substitute Inputs

Suppliers that are able to differentiate their products have higher bargaining power

Supplier Power Differentiation

also influences supplier power. A low switching cost means the supplier's bargaining power is also low.

Buyer’s switching cost to other inputs

impacts supplier powe

Process integration

means that a supplier takes on the production process of the buyer it is supplying to.

Forward Integration

means that a buyer takes on the procurement process or input production to displace the need for suppliers.

Backward Intergration

Buyers pertain to end consumers, which means the bargaining power of buyers points to the influence of consumers on product prices in the industry

Bargaining Power of Buyers

The more buyers in the industry, the less is the buyer’s bargaining power and the greater is the competition.

Number of Buyers relative to Sellers

also influence buyer power. Low switching costs give consumers greater bargaining power by enabling them to switch products.

Switching costs and availability of substitute products

also influences the bargaining power of buyers as much as it impacts supplier power

Process iNtegration

means that the consumer decides to create the product that reduces the potential for profit.

Backward Integration by Buyer

contributes to buyers’ bargaining power. The higher the quaning demanded, the greater is the bargaining power. This is commonly observed in supermarkets.

Buyer's Volune

Substitutes refer to goods or services that satisfy the same consumer need as another good or service

Threat of Substitutes

FINALS REVIEWER Flashcards

Examination Test - 2nd Semester (86 cards)